Conficker.e, as the update's been dubbed, began downloading and installing on previously-infected PCs at midnight London time, said Kevin Hogan, director of security response operations for Symantec Corp.

In several ways, the new Conficker is a lot like the original version of the worm, which appeared in November 2008. "At first blush, it looked like the Conficker.a variant," said Hogan. "But this is actually new in that it rejumbled existing code from previous versions."

It also downloads several new malicious files to the infected system that reveal how Conficker's handlers intend to profit from their collection of compromised computers, Hogan said.

According to Symantec, Conficker.e is downloading and installing Waledac, a noted bot that has been on the upswing for several months. Waledac is perhaps best known as the successor to the infamous Storm bot of 2008; researchers unanimously believe that its makers are from the same group that ran Storm last year. Like Storm, Waledac bots -- the PCs that are infected with the Trojan horse -- are rented out to spammers.

"Two things come to mind," said Hogan, referring to the Conficker.e-Waledac connection. "The people responsible for Waledac could be from the same group as Conficker, or they may be directly associated with the Conficker people. Or the people behind Conficker have sold the use of their botnet to Waledac, who in turn are in the spam business."

This is the first time that Conficker has been tied to spammers. "Now we're seeing an association with spam," said Hogan, "but the question still remains, 'Are these two groups directly related?'"

A researcher with Moscow-based Kaspersky Lab found a different money-making move by the new Conficker. According to Kaspersky research Alex Gostev, Conficker.e is downloading and installing fake security software. Often called "scareware" for its habit of trying to spook users with bogus infection warnings -- then dunning them with endless pop-ups until they fork over up to US$50 to buy the useless program -- such rogue antivirus software has become a huge business, large enough for even Microsoft to worry about. Conficker.e is installing SpywareProtect2009, said Gostev in an entry to the Kaspersky blog. "Once it's run, you see the app interface, which naturally asks if you want to remove the threats it's 'detected,'" Gostev said. "Of course, this service comes at a price -- $49.95."

Symantec's Hogan said his team was not able to confirm that Conficker also downloads scareware. "That said, not all Conficker nodes act the same," he said. "Some are not downloading at all, so it wouldn't entirely be out of the question that different nodes or sections of the botnet downloaded different things."

Conficker's rogue security software scam isn't new: The worm's first variant also tried to distribute phony antivirus software late last year, though the move was largely unsuccessful, said Hogan, citing earlier analysis by one of his researchers, Eric Chen. "But in all the buzz about Conficker.c and April 1," said Hogan, "people forgot that Conficker's makers have tried to profit in the past."

The lack of a clear business model for Conficker -- especially with Conficker.b, the early-January variant that infected at least 4 million PCs, according to Symantec's estimates -- had confounded researchers and analysts. In fact, it was one of the reasons why there was so much attention paid to the worm's new communications scheme activation date: Everyone wondered what it would do on April 1 to monetize the effort spent collecting a massive botnet.

Unlike the Conficker.c update, the newest variant restores the worm's ability to spread by exploiting the critical Windows vulnerability Microsoft patched with an emergency fix in October 2008.

"It's been pretty obvious in the last couple of weeks that the footprints of Conficker.b and Conficker.c were very different," Hogan said. While the former had infected millions of PCs, Conficker.c, which only updated still-compromised computers, was on, at most, several thousand PCs. "If they wanted to stay in business, they needed to reseed it," said Hogan.

"I don't want to be a scaremonger," cautioned Hogan, "but the situation now, as Conficker does go back to propagating, is actually more serious than a couple of weeks ago."

This story, "Conficker Worm Reveals Its Business Model" was originally published by
Computerworld.

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